How the world revolves around monopolies, and why we should make them illegal.
Society should make monopolies illegal and I strongly stand by the statement. Let’s imagine, in this current horribly dangerous second wave of COVID-19 that the Remdesivir injection, instead of being manufactured by many pharma companies, only one company had the exclusive right over its manufacturing. Not only would the supply be unable to sustain the demand, but it would also have given rise to even worse and exorbitant pricing of such crucial medications.
A monopoly is a business that is the only provider of a good or service, giving it a tremendous competitive advantage over any other company that tries to provide a similar product or service.
According to the New York Times, a whopping 77% of mobile social traffic is owned by Facebook, 74% of the ebook market is Amazon, and Google owns 88% of the search advertising market, and if you want your app to be on Apple devices, Apple will take a 30% cut of all e-payments. This discourages and creates a barrier of entry for new players and startups who want to “revolutionize” a field.
Some companies like Apple and Google become monopolies by controlling the entire stack, and become a guard: to allow or reject any new player from coming in. Whereas companies like Amazon and Facebook just buy up competitors or launch literal clones of other products, or even undercut them. Amazon is notoriously famous for copying popular products on its marketplace and launch its own amazon basics ripoff (Youtube Video by Peak Design on Amazon copying their popular sling bag ) Facebook bought Instagram and WhatsApp and is now creating the new social media clone of Clubhouse.
Monopolies restrict free trade and prevent the market from setting prices.
All of which is violating the fundamentals of a democracy.
Since monopolies are the sole provider of a substance, they can set any price they want, especially when people don’t have a choice. This is an unfortunate truth for crucial medical drugs like those of for Cancer and now even COVID vaccines.
When a corporation controls the supply, it can make inferior quality products and also artificially cause inflation. World’s 80% of oil supply is controlled by 13 countries called OPEC+ whose can inflate the price of other currencies by making crude extortionate.
The biggest downside of monopolies is the “Loss of Innovation”. Monopolies lose any incentive to innovate or provide better and improved products. With no fear of being out of business, the R&D spending of big companies especially old-school auto companies has reduced drastically. They also prevent any new upstarts to enter the market with their behaviour. They either buy them or undercut pricing to such an extent that it is not sustainable.
For all these reasons Monopolies can harm society. And it is not just about businesses, but also countries like the US, who for example restricted the export of essential vaccine raw material.
Not only is the consumer hit hard with inferior products, high pricing, and hyperinflation; but also the world economy is damaged with restrictions on innovation and bidings of Intellectual property laws.
As it was in the early age of automobiles and the dot com bubble, Society should make monopoly illegal.
It also gives a very strong proposition on why a community needs to be atmanirbhar.
The above passage was the script for my English Speaking Skills Assignment. Thanks to my friend Aryan for editing the post.